In financial planning discussions, there's a conversation that comes up periodically, and it's undeniably tough. No one wants to acknowledge that loss is part of their future. People often push back against the numbers, convinced that one person can live more cheaply than two. But that's not always how it plays out.
Consider a husband and wife who've shared decades together. A crucial part of their planning must address what expenses will look like when one passes and the other remains. I frequently hear from spouses, "Well, there won't need to be as much money," and that's partially true once the first is gone. However, the reality hits hard: many expenses stay exactly the same.
Take housing costs, for instance. Mortgage or rent payments, condo association fees—these don't change. You won't get a discount just because one person is no longer there. Property taxes? Let's dive into that - Local and state governments don't offer breaks for being solo versus a couple.
Homeowner's insurance follows suit. Your home retains its value, and premiums keep rising alongside real estate taxes. No discounts apply when the household shrinks from two to one. Then there are home repairs and maintenance. In fact, these might even increase. If the deceased spouse was the handy one, handling fixes and upkeep, the survivor could face higher costs outsourcing that work.
Utilities like electricity and gas remain steady—and they continue to inflate. You're not halving the thermostat from 72 degrees; the whole house still needs heating. Internet, cable, phone services, vehicle insurance, and car maintenance all persist unchanged. Subscriptions and membership fees? They don't automatically drop either.
Many assume they can get by on half the previous costs after a partner's death, thinking, "We're now one half of the couple." But the reduction is often minimal. In some cases, expenses rise as the remaining spouse seeks more connection—perhaps through extra trips to visit scattered family or simply to combat loneliness.
This underscores why life insurance, set up in your younger years to cover kids, college, and retirement, takes on a new role later. It fills the gap left by your absence—replacing lost income from a halted or reduced pension, or turning two Social Security checks into one. Essentially, you Insure your value to your partnership.
Life insurance pays out money, but it truly honors the commitment and covenant of love. Are you leaving your full worth behind, or undervaluing it by assuming expenses will plummet without you? Don't discount the life you've built together.
Pre-planning is key—from your 20s and 30s through your 40s, 50s, and 60s—but it doesn't end there. Commitments extend into your 70s, 80s, and 90s. If you'd like help strategizing this for your entire life, perhaps it's time to schedule your Financialoscopy®.
